Every web business tracks key performance indicators (KPIs) to measure how well it’s doing. While there are some universally important metrics, like performance and availability, each business has its own definitions of success. It also has its own user communities and competitors, meaning that it needs to watch the Web beyond its own sites in different ways.
Consider, for example, a search engine and an e-commerce site. The search engine wants to show people content, serve them relevant advertising, then send them on their way and make money for doing so. For a search engine, it’s good when people leave—as long as they go to the right places when they do. In fact, the sooner someone leaves the search engine for a paying advertiser’s site, the better, because that visitor has found what she was looking for.
By contrast, the e-commerce site wants people to arrive (preferably on their own, without clicking on an ad the e-commerce site will have to pay for) and to stay for as long as it takes them to fill their shopping carts with things beyond what they originally intended.
The operators of these two sites not only track different metrics, they also want different results from their visitors: one wants visitors to stay and the other wants them to leave.
That’s just for the sites they run themselves. The retailer might care about competitors’ pricing on other sites, and the search engine might want to know it has more results, or better ones, than others. Both might like to know what the world thinks of them in public forums, or whether social networks are driving a significant amount of traffic to their sites, or how fast their pages load.
While every site is unique and has distinct metrics, your website probably falls into one of four main categories:
- Media property
These sites offer content that attracts and retains an audience. They make money from that content through sponsorship, advertising, or affiliate referrals. Search engines, AdWords-backed sites, newspapers, and well-known bloggers are media properties.
- Transactional site
A site that wants visitors to complete a transaction—normally a purchase—is transactional. There’s an “ideal path” through the site that its designers intended, resulting in a goal or outcome of some kind. The goal isn’t always a purchase; it can also be enrollment (signing up for email) or lead generation (asking salespeople to contact them), and that goal can be achieved either online or off.
- Collaboration site
On these sites, visitors generate the content themselves. Wikis, news aggregators, user groups, classified ad listings, and other web properties in which the value of the site is largely derived from things created by others are all collaborative.
- Software-as-a-service (SaaS) application
These sites are hosted versions of software someone might buy. SaaS subscribers expect reliability and may pay a monthly per-seat fee for employees to use the service. Revenues come from subscriptions, and a single subscriber may have many user accounts. On some SaaS sites, users are logged in for hours every day.
It’s common for parts of a site to fall into different categories. An analyst firm that sells reports is both a media property and a transactional site. A popular blog is as much about collaborative comments its users leave as it is about Google AdWords on the pages it serves. A video upload site is a media property filled with content users provide. And a free-to-try SaaS site that encourages users to subscribe to a premium version has a transactional aspect, as well as embedded ads similar to a media site.
The key is to decide which of these categories fits each part of your site, and then to determine which metrics and tools you should use to understand your web properties, your community, and your competitors. Let’s look at each type of site in more detail.
Media sites are high-profile web destinations that provide content to attract visitors. They then display relevant advertising to those visitors in return for pay-per-click or pay-per-view revenues. In a few cases, the sites also sell premium subscriptions, which can be treated as separate transactional sites. Sites like CNET.com, MTV.com, NYTimes.com, and TechCrunch.com fall within this category.
Figure 2-1 illustrates the basic elements of a media site’s business model.
The media site embeds a link to an ad network’s content within the media site’s pages.
A visitor retrieves the media site’s page with the embedded ad.
The visitor clicks on the advertisement and visits the advertiser’s site.
Alternatively, the visitor may leave the site without clicking on an ad, in which case the visit has not helped the media site make money (but it has raised the site’s traffic numbers, which may attract advertisers).
The advertiser pays the ad network for ad traffic, and the ad network shares a portion of the money with the media site.
Additionally, the visitor may subscribe to a feed, bookmark the site, invite friends, or do other things that make him more likely to return, boosting the media site’s number of loyal visitors.